American retail chain company Kohl’s Corp. shares more than doubled on Tuesday, making it the latest meme stock, as retail traders on social media heavily mentioned it.
Shares of the retailer surged as much as 105% during early trading, marking the largest one-day increase on record and returning the stock to levels last seen nearly a year ago. The stock was briefly halted due to volatility after trimming its gains and was approximately 27 per cent higher at 9:52 a.m. in New York, according to a report by Bloomberg News.
“It’s all social media chatter. Remember that a highlight of the meme stock era was a dose of nostalgia for companies like GameStop and AMC,” Steve Sosnick of Interactive Brokers told Bloomberg. “Social media chatter can become self-fulfilling,” he added.
Short interest, which is the amount of shares borrowed to short, accounts for approximately 48 per cent of Kohl’s float, the report said citing data from S3 Partners LLC. This figure way above than the levels reported by companies such as Apple Inc. and Tesla Inc., which have less than 3 per cent of their float borrowed to short. GameStop Corp, a prominent entity of the meme stock era, has about 20% short interest.
Kohl’s stock rose steadily from an early April low, mainly due to US President Donald Trump’s escalation of tariffs on Liberation Day, gaining more than 60 per cent by yesterday’s close. However, shares were still over 25 per cent lower through Monday as the retailer faced a sales decline and dealt with the repercussions of firing its chief executive officer, Ashley Buchanan, just months after he took the role.
Notably, the Dow Jones, Nasdaq Composite, and S&P 500 opened flat during the market session on Tuesday without significant movement as US investors concentrated on President Donald Trump’s trade agreements with global nations and corporate earnings.
